Will Important Message of Secret US Sessions Be Heard in Iran?

Thursday, February 6, 2014

Amir Hossein Yazdanpanah
Expert on International Issues

“It is [still] premature to get excited about the Iranian market as sanctions are still in force.” (CNBC news; January 22, 2014) The above remark belongs to Carlos Ghosn, the CEO of Renault Nissan Company. He made this remark in an interview with the CNBC news channel soon after the implementation of the Geneva agreement between Iran and the six world powers started [on January 20]. He heads a company, which has already seen its regional sales in Asia and Pacific plummet by 7.4 percent following the decision to reduce trade with Iran as a result of escalating sanctions against the Islamic Republic during the past two years. However, why Ghosn, who is more aware than anybody else of the opportunities that the Iranian market will offer his company and is also aware of the warm welcome that his company will receive in Iran, should utter such a remark?

After the interim nuclear agreement was signed in Geneva, many analysts, most of whom affiliated to the Iranian government, started to argue that the agreement has caused “cracks” in the structure of sanctions and these cracks will work to totally collapse the anti-Iran sanctions regime in the near future. This analysis can be relatively accepted and perhaps this was the main reason behind high concerns within the US Congress and administration. Regular visits to the Middle East region by David S. Cohen, the United States Treasury's Under Secretary for Terrorism and Financial Intelligence, who is considered as the main American official pushing for more sanctions against Iran during the past two years, and his warnings to Iran's neighboring countries clearly prove that the United States government has serious concerns that the aforesaid tracks may actually cause the overall structure of anti-Iran sanctions to totally collapse.

Therefore, the opposite party has already begun its political game whose main goal is to prevent this from happening. This game has entered a new phase through secret meetings which have been held by various officials of the US Treasury Department in Paris and London with officials from major economic companies of the world. Now, the question is to what extend those “cracks” in sanctions will be able to help the Iranian government to end sanctions and, more accurately, will the United States allow this to happen?

An American official has given a well-calculated and precise answer to this question by telling the Wall Street Journal on February 1, 2014, that the US government is holding meetings with the private sectors in different countries to make sure that all companies across the world have a good grasp of the extent of sanctions against Iran. The newspaper did not mention the name of that American official, but the report, in itself, is a telltale account of secret meetings that are held by the US Treasury Department with the world’s economic giants. The main objective of these sessions is to tell those company’s officials that under the present circumstances, any kind of agreement with Iran should be simply limited to the six-month period set by the Geneva agreement.

The question which arises here is “are major economic corporations in the world actually ready to sign contracts with Iran for only a period of six months?” The answer to this question has been already given by both Carlos Ghosn, the CEO of Renault Nissan, and other big companies’ executives who have been taking part in the secret meetings arranged by the US Treasury Department. Their answer should be taken very importantly and seriously by the Iranian economic and political officials as they have been indirectly told this: “The message we have received in those meetings is that we cannot undertake any long-term obligation in Iran.” It goes without saying that as long as the full sanctions regime against Iran has not been lifted, such companies would not look to Iran as a permanent market. Under these conditions, they will only look upon the Iranian market as just a temporary one which is more like seasonal “sales” markets. Such markets are usually short-lived and when they come to an end, there will be usually no sign of either sellers, or buyers.

Such temporary markets usually bring with them temporary and ephemeral prosperity and benefits, but later consequences that arise from their temporary nature can plague the Iranian economy and production for long periods of time. One consequence is that if such cooperation is actually undertaken on a temporary basis, it would not end in technology transfer, nor provision of aftersales services will continue for long after the products are sold, nor even it can really help to spur domestic production in the country. More importantly, there is a risk that Iranian companies may be carried away by such temporary economic exchanges with such companies that know they are here for a short period of time. As a result, those Iranian companies will not be able to act appropriately and, for example, may make certain aspects of their productions, which are directly connected to the country’s national interests, dependent on such ephemeral cooperation. If this happens, such contracts will eventually become the Achilles hill of the ailing economy of Iran. A more disconcerting aspect of such contracts is that in view of the existing unstable conditions that surround the Iranian economy, which are best characterized by lack of a clear future prospect as a result of political uncertainties, these contracts will finally deal severe blows to the national economy of Iran. Under these circumstances, we should ask ourselves “will entering such an unsafe and uncertain path by getting carried away with the suspension of ‘some sanctions’ help our damaged economy to stand on its own feet?” Have Iranian economic decision-makers actually taken such concerns onboard from a strategic viewpoint?

In reality, those company officials, who make strategic plans for their companies on the basis of a long-term view, will not be very happy with six-month suspension of “some sanctions” against Iran. As a result, the economic officials in Iran should not be also very ecstatic about such temporary sanctions relief. Whether suspension of sanctions is for a period of six months or six years, it should give this important message to Iranian officials that attaching more importance to national production and endogenous economy should be the main strategy to be followed by the government. At a time that the United States has already started its political activities in order to prevent the total collapse of anti-Iran sanctions, will we be able to take any real step to cut the dependence of the national economy of Iran on foreign companies?